Oil Prices Rally as Brent Nears $100 on U.S.-Iran Escalation

Oil prices extended their rally during Asian trading on Wednesday, with Brent crude approaching the key $100-per-barrel level as escalating U.S.-Iran tensions fueled concerns over Middle East oil supplies and shipping through the Strait of Hormuz.

Brent oil futures for November delivery climbed 1.4% to $99.32 per barrel as of 21:32 ET (01:32 GMT). West Texas Intermediate (WTI) crude futures advanced 1.5% to $94.44 per barrel, putting WTI on track for a seventh consecutive session of gains. Both benchmarks reached their highest levels in weeks.

The latest oil price surge followed another escalation between Washington and Tehran. The U.S. military said Tuesday that it destroyed five Iranian oil tankers after Iranian missile attacks targeted U.S. naval assets.

Iran subsequently launched missiles toward U.S. targets in Jordan and warned Gulf countries, including Kuwait and Bahrain, against assisting American forces. Meanwhile, Iran-backed Houthi forces attacked Saudi Arabia, striking energy and economic facilities across several southern cities and injuring more than 70 people.

Saudi officials reported fires at energy infrastructure, including the Jazan refinery, although the scale of the resulting disruption remained uncertain.

U.S. Secretary of State Marco Rubio warned that Washington would continue targeting Iranian oil tankers in response to attempted attacks on U.S. warships, increasing fears of further escalation.

Attention remains focused on the Strait of Hormuz, one of the world's most important oil shipping routes. Iran has announced plans for a maritime exclusion zone around the waterway, while shipping traffic has already fallen sharply amid security concerns.

Some crude shipments are still moving through Hormuz, and Gulf oil producers are using alternative ports and export routes where possible. Continued flows have helped keep Brent below $100 despite mounting geopolitical risks.

However, further disruptions could send crude prices significantly higher. Goldman Sachs warned that oil could reach $120 per barrel if attacks on Middle Eastern vessels intensify and shipping conditions deteriorate.

The sustained oil rally is also increasing concerns about global inflation and interest rates, as higher energy costs could complicate the outlook for central banks and the broader economy.